Climate adaptation funding gap 50% higher than estimated, UN says

SINGAPORE: Rich country promises of help for poorer ones to adapt to climate change have slowed despite more frequent extreme weather, with a shortfall now 50% bigger than previously estimated, a U.N. agency said in a report said on Thursday.

Developed countries pledged in 2009 to provide $100 billion a year in climate finance to poorer nations, and mobilising funds will be a key talking point in COP28 negotiations in Dubai at the end of November.

The $100 billion pledge, which has not been fully secured, was aimed at helping poorer countries not only mitigate climate change by cutting greenhouse gas emissions, but also to adapt to rising temperatures and sea levels.

However, the annual financing shortfall for adaptation alone now stands at $194 billion to $366 billion, with existing financial flows reaching just $25 billion during the 2017-2021 period, the U.N. Environment Program (UNEP) said.

"Action to protect people and nature is more pressing than ever," U.N. Secretary General Antonio Guterres said in a statement. "Yet as needs rise, action is stalling."

The 2017-2021 financing amounted to about $3 a person, and annual flows dropped 15% in 2021, said Georgia Savvidou, a researcher at Chalmers University of Technology and a co-author of the UNEP report.

"We really need ambitious adaptation action this decade, and if not, we will increase losses and damage," she said.

Every $1 billion spent on tackling coastal flooding, for example, would help avoid $14 billion in economic damage, the UNEP said.

Guterres called on developed nations to meet pledges made at climate talks in 2021 to double adaptation funds, adding that a windfall tax should be levied on fossil fuel companies to compensate for climate losses.

While financing for mitigation projects like renewable energy has increased, mobilising adaptation funds has proven difficult, said Pieter Pauw of the Eindhoven University of Technology, another UNEP co-author.

"Mitigation is often more interesting for donors because the atmosphere is a global public good and also because investments in mitigation often pay off," he said.

UNEP estimated that developing countries required $215-$387 billion per year until 2030 to adapt to climate impacts, with the figure set to rise significantly by 2050.

"The numbers are not that big: if you compare the $100 billion to the money that the United States spends on its military, and that was spent on COVID or to save its banks, this is peanuts," said Pauw.

"We literally have a world to win here ... It is time for developed countries to step up and provide more."